Basic: Stores pricing. Z Ltd had the following transactions in one of its raw materials during April:

You are required to:

(a) Write up the stores ledger card using (i) FIFO and (ii) LIFO methods of stock valuation. (8 marks)

(b) State the cost of material used for each system during April. (2 marks)

(c) Describe the weighted average method of valuing stocks and explain how the use of this method would affect the cost of materials used and the balance sheet of Z Ltd compared to FIFO and LIFO in times of consistently rising prices. (Do NOT restate the stores ledger card for the above transactions using this method.) (5 marks)
CIMA Stage 1 Accounting

Transcribed Image Text:

Opening stock 40 units @10 each April 4 Bought 140 units @11 each 10 Used 90 units 12 Bought 60 units @12 each 13 Used 100 units 16 Bought 200 units @10 each 21 Used 70 units 23 Used 80 units 26 29 222 Bought 50 units @12 each Used 60 units